Reimagining Andhra Pradesh IT Policy 2014-2020 … Andhra Pradesh IT Policy 2014-2020 Electronics...

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Information Technology, Electronics & Communications DepartmentGovernment of Andhra Pradesh

The Government of Andhra Pradesh is determined to script its development journey

while incorporating Information Technology at each level and attain leadership

position in the current age.

The Government aims to use e-Governance as a tool to provide integrated services

to its citizens through a free flow of information, and to be a role model in Good

Governance. Based on the Blueprint document, the State Government has

formulated three core policies; IT, Electronics and Innovation & Start-up.

IT policy is based on key four pillars, namely, Human Capital, Infrastructure,

Incentives and above all, a system of Good Governance. The policy envisages

abundant investment opportunities for the industry, employment generation and

enhancing productivity and competitiveness.

With the Electronics policy, Government intends to make Electronics industry as the

growth engine while effectively utilizing the huge talent pool and skilled manpower of

Andhra Pradesh.

For the development of Innovation, entrepreneurship and start-up culture in the State,

The Government has set up an Innovation & Capacity Building Mission. Through this

the State envisages to create the culture of research, innovation and

entrepreneurship. This would contribute to increased knowledge, wealth and

employment in our society.

I am certain that these three policies, prepared with due deliberations and

consultation with the industry and thought leaders, would act as a strong foundation

for the development of the State in the coming years.

NARA CHANDRABABU NAIDU

HON’BLE CHIEF MINISTER OF ANDHRA PRADESH

[ N. CHANDRABABU NAIDU ]

MESSAGE

HON’BLE MINISTER, GoAPInformation & Public Relations,

Information Technology, Electronics & Communications,Non-resident Indian Empowerment & Relations,

Telugu Language & Culture, Minority Welfare & Empowerment

DR. PALLE RAGHUNATHA REDDY, MSc, MPhil, Phd

(PALLE RAGHUNATHA REDDY)

The state firmly believes that technology is the backbone of economy and hence has

developed an inclusive Blueprint for development of Electronics & ICT Industry in the

State.

Taking cues from the Blueprint, ITE&C Department has come out with three

comprehensive policies. The IT Policy being an umbrella concept provides lucrative

incentives for setting up industries in all locations in the State. The Policy aims to enable

the Government and citizens to take advantage of the cutting-edge technologies like

SMAC currently and those that emerge in future.

Further, the Electronics Policy aims to develop Electronics manufacturing clusters, build

infrastructure such as Electronic Hardware Parks and also provide fiscal and non-fiscal

incentives to promote the industry, while generating employment.

Our Government is determined to promote the culture of innovation and

entrepreneurship in the youth. The Innovation and Start-up Policy ambitiously targets to

create a world class 'technology start-up ecosystem' by nurturing 'entrepreneurship and

a culture of innovation' which would contribute to increased knowledge, wealth and

employment.

IT and Electronics industries are the core industries that can help the Government re-

imagine and reconstruct the new state of Andhra Pradesh. I am sure, these policies

would help accelerate the process.

MESSAGE

The Government of Andhra Pradesh has developed a blueprint "Re-Imagining Andhra

Pradesh - role of e-Governance, Electronics and IT" for development of ICT Industry in

the State. The blueprint envisages a large number of conducive policies and simple but

effective frameworks being put in place. It has laid out a vision to "develop AP as an

Innovation Society of global repute, with a focus on enhancing the Quality of Life of its

citizens, through high-quality Education and Healthcare, increased productivity in

Agriculture and allied activities, creation of Employment by promoting Electronics and

IT, and above all, by providing Good Governance."

The IT policy, Electronic Policy and Innovation & Startup Policies are among the 18

policies that have emanated out of the Blue Print, for the growth of IT and Electronics

sector in the Andhra Pradesh, the sun-rise state of Nation

All these three policies are based on key four pillars, namely, Human Capital,

Infrastructure, Incentives and above all, a system of Good Governance.

I am sure these three policies will play a lead role over the next 5 years in spreading of

IT applications across the length breadth of the State for generation of gainful

employment and socio economic development.

(J. SATYANARAYANA)

MESSAGE

J. SATYANARAYANA, IAS (Retd.) ADVISOR TO GOVERNMENT OF AP

e-Government, Electronics & IT

HON’BLE MINISTER, GoAPInformation & Public Relations,

Information Technology, Electronics & Communications,Non-resident Indian Empowerment & Relations,

Telugu Language & Culture, Minority Welfare & Empowerment

DR. PALLE RAGHUNATHA REDDY, MSc, MPhil, Phd

(PALLE RAGHUNATHA REDDY)

The state firmly believes that technology is the backbone of economy and hence has

developed an inclusive Blueprint for development of Electronics & ICT Industry in the

State.

Taking cues from the Blueprint, ITE&C Department has come out with three

comprehensive policies. The IT Policy being an umbrella concept provides lucrative

incentives for setting up industries in all locations in the State. The Policy aims to enable

the Government and citizens to take advantage of the cutting-edge technologies like

SMAC currently and those that emerge in future.

Further, the Electronics Policy aims to develop Electronics manufacturing clusters, build

infrastructure such as Electronic Hardware Parks and also provide fiscal and non-fiscal

incentives to promote the industry, while generating employment.

Our Government is determined to promote the culture of innovation and

entrepreneurship in the youth. The Innovation and Start-up Policy ambitiously targets to

create a world class 'technology start-up ecosystem' by nurturing 'entrepreneurship and

a culture of innovation' which would contribute to increased knowledge, wealth and

employment.

IT and Electronics industries are the core industries that can help the Government re-

imagine and reconstruct the new state of Andhra Pradesh. I am sure, these policies

would help accelerate the process.

MESSAGE

The Government of Andhra Pradesh has developed a blueprint "Re-Imagining Andhra

Pradesh - role of e-Governance, Electronics and IT" for development of ICT Industry in

the State. The blueprint envisages a large number of conducive policies and simple but

effective frameworks being put in place. It has laid out a vision to "develop AP as an

Innovation Society of global repute, with a focus on enhancing the Quality of Life of its

citizens, through high-quality Education and Healthcare, increased productivity in

Agriculture and allied activities, creation of Employment by promoting Electronics and

IT, and above all, by providing Good Governance."

The IT policy, Electronic Policy and Innovation & Startup Policies are among the 18

policies that have emanated out of the Blue Print, for the growth of IT and Electronics

sector in the Andhra Pradesh, the sun-rise state of Nation

All these three policies are based on key four pillars, namely, Human Capital,

Infrastructure, Incentives and above all, a system of Good Governance.

I am sure these three policies will play a lead role over the next 5 years in spreading of

IT applications across the length breadth of the State for generation of gainful

employment and socio economic development.

(J. SATYANARAYANA)

MESSAGE

J. SATYANARAYANA, IAS (Retd.) ADVISOR TO GOVERNMENT OF AP

e-Government, Electronics & IT

SECRETARY TO GOVERNMENTInformation Technology,

Electronics & Communications Department Government of Andhra Pradesh

B. SREEDHAR, IAS

Government of Andhra Pradesh came up with the IT, Electronics and Innovation &

Startups policies in order to enable the Government to inter-operate IT businesses

with ease, and provide integrated services to the citizens.

The Policies lay emphasis on the development of state-of-the-art infrastructure, more

specifically, Mega IT hubs, EMCs, ITIRs, IT Layouts/Parks, and Innovation sectors,

through Public Private Partnership mode with conducive incentives and felicitations.

The incentives and business enablers in these policies are unparalleled in the Country.

In addition to investor-friendly incentives and proactive government support, the policies

also emphasize on developing the Innovation & Entrepreneurship culture amongst the

students.

I am certain that these policies will boost investments into Andhra Pradesh, create

ample job opportunities and also build the culture of innovation and entrepreneurship.

(B. SREEDHAR)

MESSAGE

VISION

To develop AP as an Innovation Society of global

repute, with a focus on enhancing the Quality of Life

of its citizens, through high-quality Education and

Healthcare, increased productivity in Agriculture

and allied activities, creation of Employment by

promoting Electronics and IT, and above all,

by providing Good Governance

SECRETARY TO GOVERNMENTInformation Technology,

Electronics & Communications Department Government of Andhra Pradesh

B. SREEDHAR, IAS

Government of Andhra Pradesh came up with the IT, Electronics and Innovation &

Startups policies in order to enable the Government to inter-operate IT businesses

with ease, and provide integrated services to the citizens.

The Policies lay emphasis on the development of state-of-the-art infrastructure, more

specifically, Mega IT hubs, EMCs, ITIRs, IT Layouts/Parks, and Innovation sectors,

through Public Private Partnership mode with conducive incentives and felicitations.

The incentives and business enablers in these policies are unparalleled in the Country.

In addition to investor-friendly incentives and proactive government support, the policies

also emphasize on developing the Innovation & Entrepreneurship culture amongst the

students.

I am certain that these policies will boost investments into Andhra Pradesh, create

ample job opportunities and also build the culture of innovation and entrepreneurship.

(B. SREEDHAR)

MESSAGE

VISION

To develop AP as an Innovation Society of global

repute, with a focus on enhancing the Quality of Life

of its citizens, through high-quality Education and

Healthcare, increased productivity in Agriculture

and allied activities, creation of Employment by

promoting Electronics and IT, and above all,

by providing Good Governance

AP IT Policy 2014-202001Srikakulam

Vijayanagaram

Visakhapatnam

East Godavari

West Godavari

KrishnaGuntur

OngoleKurnool

KadapaAnantapuram Nellore

Chittoor

AP IT Policy 2014-202001Srikakulam

Vijayanagaram

Visakhapatnam

East Godavari

West Godavari

KrishnaGuntur

OngoleKurnool

KadapaAnantapuram Nellore

Chittoor

Gateway Backside

No Printing

ndhra Pradesh had taken a leadership position

Ain e-Governance and Information Technology.

The Growth was propelled by the availability

of rich talent pool, lower cost of operations and in

some measure due to the innovative policies of the

Government. Consequent on the reorganisation of the

State, it is imperative to revisit the existing policy initiatives

and make them more attractive to suit the current and

future requirements of the new State of Andhra Pradesh.

In the above context, the Government of Andhra Pradesh

has developed a blueprint “Re-Imagining Andhra

Pradesh - Role of e-Governance, Electronics and IT”

for the development of the ICT Industry in the State.

The blueprint envisages a large number of conducive

policies and simple but effective frameworks being

put in place. It has laid out a vision to “develop AP as

an Innovation Society of global repute, with a focus

on enhancing the Quality of Life of its citizens, through

high-quality Education and Healthcare, increased

productivity in Agriculture and allied activities, creation

of Employment by promoting Electronics and IT,

and above all, by providing Good Governance.”

The objectives and targets laid out for the next five

years are

• to be FIRST in India in Quality & Quantity

of e-Services

• to be known as the Silicon Corridor of India

• to attract Investments of US $ 2 bn in IT

and US $ 5 bn in Electronics manufacturing

• to get a 5% share in national exports of Software

• to create an additional direct employment

of 0.5 mil

• to take Gigabit to all Villages

• to make at least one person e-literate

in every household

The blueprint has identified a set of 18 policies and

frameworks to realize the vision and goals stated above.

The IT policy laid down in this document is one among

An effective policy for the development of IT should base

itself on the four pillars, namely, Human Capital,

Infrastructure, Incentives and above all, a system of

Good Governance. This document specifies the policy

initiatives that the Government intends to take in these

four areas.

1. Human Capital: Availability of a pool of high-quality

manpower is a sine qua non for the development of IT

Industry. While AP has over 200 engineering colleges and

a large number of training institutions specialized in IT

and computer sciences, it is necessary to create an

environment that promotes quality of education in

emerging technologies and alignment with the specific

needs of the industry. To this end, the following initiatives

shall be taken.

1.1 Changing Course Curriculum: Universities

will be advised to change the course curriculum

to be in tune with the emerging technologies

and aligned to the requirements of the Industry,

and to introduce courses in entrepreneurship

development.

1.2 Credits for Online Courses: The Universities

will be advised to give credits to the students

successfully completing notified online courses.

1.3 Faculty Upgradation: A special scheme of

faculty upgradation shall be introduced.

1.4 Establishment of Premier Institutes:

The Government would support opening of

premier IT institutes in partnership with the top

IT Companies and Foreign Universities.

1.5 Mandatory Apprenticeship: All educational

institutions offering under-graduate courses in

software engineering, electronics and computer

sciences shall implement a mandatory scheme

of internship / apprenticeship in the 4th Year

of the course in association with the industry.

1.6 Skill Enhancement by MSMEs: Assistance shall

be provided to MSMEs with a minimum of 20

employees on its rolls by way of reimbursement

of 50% of training fees, subject to a maximum of

` 10,000 (INR Ten thousand only) per employee,

on obtaining recognized certifications in emerging

technologies. The assistance under this category

shall be limited to ` 1 lakh (INR One lakh only)

per year per unit.

1.7 Recruitment Assistance: A recruitment assistance

of `15 lakh (INR Fifteen lakh only) to the SMEs

which attain an employment of 100 employees

within three years of commencement of

commercial operations.

1.8 Innovation Policy: Innovation is the prime focus

area for the growth of IT industry in the State.

An Innovation Policy shall be announced to

promote start-ups and IT units developing

innovative products in the State.

1.9 e-Literacy: An appropriate scheme would be

announced to make one person e-literate in

every household, in partnership with the industry.

ANDHRA PRADESH - SUNRISE STATE OF INDIA

Booklet on ITE&C Department Policies, 2014-2020 | 12

2. Infrastructure

2.1 Vizag as a Mega IT Hub: Government shall

endeavour to establish state-of-the-art

infrastructure of international standards suiting

to the requirements of the IT / ITES Industry.

Visakhapatnam will be developed as a Mega IT

Hub, through an initial effort of developing an IT

township with a built-up space of 5 million square

feet. A signature tower of 1 million square feet

shall form the nucleus of the Mega IT Hub.

2.2 IT Hubs: IT Hubs shall also be developed at

Vijayawada, Kakinada, Tirupati and Anantapur.

2.3 PPP for IT Infrastructure: The facilities, in the

form of IT Towers, IT Parks and IT Zones, shall be

developed adopting a transparent PPP policy. The

following principles will form part of such a policy:

a. For each project, APIIC shall select a partner,

who can be a developer or a consortium of

developers and the industry players, through

a bidding process involving QCBS method.

b. The responsibility of marketing the facilities created

shall be with the selected partner. The Government

shall provide such promotional support as needed.

c. Appropriate relaxations will be provided from the

zoning regulations and land usage conversions,

subject to environmental safeguards.

d. Relaxation to AP Building Rules would be

considered, subject to the payment of City Level

Infrastructure Impact Fee and clearances from Fire

Services, Airport Authority and conformance to the

National Building Code and statutory regulations.

e. The principles of green buildings, green IT, e-Waste

management, Walk-to-Work and Cycle-to-Work

shall be followed while designing the facilities.

2.4 Information Technology Investment Regions

(ITIRs): To attract Investments in IT / ITES, and

Electronic Manufacturing units, Government of

India, had notified the ITIR policy in 2008. ITIR

is expected become a significant driver of the

economic activity in the region, by funnelling the

resources and efforts of the Central, State and local

governments into the ITIR. Government proposes

ITIRs to be developed in Visakhapatnam and

Tirupati initially. The Tirupati-Anantapur corridor

will be proposed at a later phase.

2.5 Other Critical Infrastructure:

a. Air Connectivity: The process of expansion and

modernization of the airports at Visakhapatnam

and Tirupati are afoot. The Government shall take

speedy and effective steps to develop the other

airports in the state to cater to needs of the

industry.

b. Assured Power: Andhra Pradesh has recently

been selected as a pilot State to implement the

scheme of 24x7 power supply. Within a span of

5 years, the Government intends to make the

State power surplus. As an interim measure,

the ICT industry would be exempt from the

purview of statutory power cuts.

c. Social Infrastructure: A multi-departmental

mechanism would be established to improve

the social infrastructure in the cities selected

to be developed as IT Hubs.

3. Incentives

A. Incentives applicable to all categories of

IT Industry:

A1- Non-Fiscal Incentives

3.1 ICT industry would be exempt from the purview

of the AP Pollution Control Act, except in respect

of power generation sets.

3.2 IT industry would be exempt from inspections

under the following Acts and the Rules framed

there under, barring inspections arising out of

specific complaints. The IT units are permitted to

file self-certifications, in the prescribed formats.

i. The Factories Act, 1948

ii. The Maternity Benefit Act, 1961

iii. The AP Shops & Establishments Act, 1988

iv. The Contract Labour (Regulations & Abolition)

Act, 1970

v. The Payment of Wages Act, 1936

vi. The Minimum Wages Act, 1948

vii. The Employment Exchanges (Compulsory

Notification of Vacancies) Act, 1959

3.3 General permission shall be available for 3 shift

operations with women working in the night for

IT / ITES Units / Companies, subject to the IT

units taking the prescribed precautions in

respect of safety and security of employees.

3.4 IT / ITES Units / Companies and non-hazardous

hardware manufacturing industry are declared

as essential service under AP Essential Services

Maintenance Act.

3.5 CCITI: An empowered ‘Consultative Committee

for the IT Industry’ would be formed with the

representatives of industry and the other

stakeholders. The CCITI would administer the

incentives in a speedy, time-bound and

transparent manner.

13 | Booklet on ITE&C Department Policies, 2014-2020

ndhra Pradesh had taken a leadership position

Ain e-Governance and Information Technology.

The Growth was propelled by the availability

of rich talent pool, lower cost of operations and in

some measure due to the innovative policies of the

Government. Consequent on the reorganisation of the

State, it is imperative to revisit the existing policy initiatives

and make them more attractive to suit the current and

future requirements of the new State of Andhra Pradesh.

In the above context, the Government of Andhra Pradesh

has developed a blueprint “Re-Imagining Andhra

Pradesh - Role of e-Governance, Electronics and IT”

for the development of the ICT Industry in the State.

The blueprint envisages a large number of conducive

policies and simple but effective frameworks being

put in place. It has laid out a vision to “develop AP as

an Innovation Society of global repute, with a focus

on enhancing the Quality of Life of its citizens, through

high-quality Education and Healthcare, increased

productivity in Agriculture and allied activities, creation

of Employment by promoting Electronics and IT,

and above all, by providing Good Governance.”

The objectives and targets laid out for the next five

years are

• to be FIRST in India in Quality & Quantity

of e-Services

• to be known as the Silicon Corridor of India

• to attract Investments of US $ 2 bn in IT

and US $ 5 bn in Electronics manufacturing

• to get a 5% share in national exports of Software

• to create an additional direct employment

of 0.5 mil

• to take Gigabit to all Villages

• to make at least one person e-literate

in every household

frameworks to realize the vision and goals stated above.

The IT policy laid down in this document is one among

An effective policy for the development of IT should base

itself on the four pillars, namely, Human Capital,

Infrastructure, Incentives and above all, a system of

Good Governance. This document specifies the policy

initiatives that the Government intends to take in these

four areas.

1. Human Capital: Availability of a pool of high-quality

manpower is a sine qua non for the development of IT

Industry. While AP has over 200 engineering colleges and

a large number of training institutions specialized in IT

and computer sciences, it is necessary to create an

environment that promotes quality of education in

emerging technologies and alignment with the specific

needs of the industry. To this end, the following initiatives

shall be taken.

1.1 Changing Course Curriculum: Universities

will be advised to change the course curriculum

to be in tune with the emerging technologies

and aligned to the requirements of the Industry,

and to introduce courses in entrepreneurship

development.

1.2 Credits for Online Courses: The Universities

will be advised to give credits to the students

successfully completing notified online courses.

1.3 Faculty Upgradation: A special scheme of

faculty upgradation shall be introduced.

1.4 Establishment of Premier Institutes:

The Government would support opening of

premier IT institutes in partnership with the top

IT Companies and Foreign Universities.

institutions offering under-graduate courses in

software engineering, electronics and computer

sciences shall implement a mandatory scheme

of internship / apprenticeship in the 4th Year

of the course in association with the industry.

1.6 Skill Enhancement by MSMEs: Assistance shall

be provided to MSMEs with a minimum of 20

employees on its rolls by way of reimbursement

of 50% of training fees, subject to a maximum of

` 10,000 (INR Ten thousand only) per employee,

on obtaining recognized certifications in emerging

technologies. The assistance under this category

shall be limited to ` 1 lakh (INR One lakh only)

per year per unit.

1.7 Recruitment Assistance: A recruitment assistance

of `15 lakh (INR Fifteen lakh only) to the SMEs

which attain an employment of 100 employees

within three years of commencement of

commercial operations.

1.8 Innovation Policy: Innovation is the prime focus

area for the growth of IT industry in the State.

An Innovation Policy shall be announced to

promote start-ups and IT units developing

innovative products in the State.

1.9 e-Literacy: An appropriate scheme would be

announced to make one person e-literate in

every household, in partnership with the industry.

ANDHRA PRADESH - SUNRISE STATE OF INDIA

2. Infrastructure

2.1 Vizag as a Mega IT Hub: Government shall

endeavour to establish state-of-the-art

infrastructure of international standards suiting

to the requirements of the IT / ITES Industry.

Visakhapatnam will be developed as a Mega IT

Hub, through an initial effort of developing an IT

township with a built-up space of 5 million square

feet. A signature tower of 1 million square feet

shall form the nucleus of the Mega IT Hub.

2.2 IT Hubs: IT Hubs shall also be developed at

Vijayawada, Kakinada, Tirupati and Anantapur.

2.3 PPP for IT Infrastructure: The facilities, in the

form of IT Towers, IT Parks and IT Zones, shall be

developed adopting a transparent PPP policy. The

following principles will form part of such a policy:

a. For each project, APIIC shall select a partner,

who can be a developer or a consortium of

developers and the industry players, through

a bidding process involving QCBS method.

b. The responsibility of marketing the facilities created

c. Appropriate relaxations will be provided from the

d. Relaxation to AP Building Rules would be

e. The principles of green buildings, green IT, e-Waste

2.4 Information Technology Investment Regions

(ITIRs): To attract Investments in IT / ITES, and

Electronic Manufacturing units, Government of

India, had notified the ITIR policy in 2008. ITIR

is expected become a significant driver of the

economic activity in the region, by funnelling the

resources and efforts of the Central, State and local

governments into the ITIR. Government proposes

ITIRs to be developed in Visakhapatnam and

Tirupati initially. The Tirupati-Anantapur corridor

will be proposed at a later phase.

a. Air Connectivity: The process of expansion and

modernization of the airports at Visakhapatnam

and Tirupati are afoot. The Government shall take

speedy and effective steps to develop the other

airports in the state to cater to needs of the

industry.

b. Assured Power: Andhra Pradesh has recently

been selected as a pilot State to implement the

scheme of 24x7 power supply. Within a span of

5 years, the Government intends to make the

State power surplus. As an interim measure,

the ICT industry would be exempt from the

purview of statutory power cuts.

c. Social Infrastructure: A multi-departmental

mechanism would be established to improve

the social infrastructure in the cities selected

to be developed as IT Hubs.

3. Incentives

A. Incentives applicable to all categories of

IT Industry:

A1- Non-Fiscal Incentives

3.1 ICT industry would be exempt from the purview

of the AP Pollution Control Act, except in respect

of power generation sets.

3.2 IT industry would be exempt from inspections

under the following Acts and the Rules framed

there under, barring inspections arising out of

specific complaints. The IT units are permitted to

file self-certifications, in the prescribed formats.

iv. The Contract Labour (Regulations & Abolition)

Act, 1970

vii. The Employment Exchanges (Compulsory

Notification of Vacancies) Act, 1959

3.3 General permission shall be available for 3 shift

operations with women working in the night for

IT / ITES Units / Companies, subject to the IT

units taking the prescribed precautions in

respect of safety and security of employees.

3.4 IT / ITES Units / Companies and non-hazardous

hardware manufacturing industry are declared

as essential service under AP Essential Services

Maintenance Act.

3.5 CCITI: An empowered ‘Consultative Committee

for the IT Industry’ would be formed with the

representatives of industry and the other

stakeholders. The CCITI would administer the

incentives in a speedy, time-bound and

transparent manner.

3.6 Land Allotment: Allotment of Government land

or land held by APIIC for industrial development,

to the IT units shall be governed by the following

principles.

a. The land allocation for IT Industry will be as per

GO Ms. No:571, Revenue (Assgn.I) Department,

dated:14/09/2012.

b. The land allotment would be based on the business

proposal and the investment capacity of the

company / investor.

c. Rebate on Cost of Land Allotted: A rebate on the

cost of the land will be provided @ ` 60,000 per

employee to the Mega IT Projects (defined below)

and ` 40,000 per employee for other IT projects,

subject to a maximum of 80% of the land cost as

determined by the allotment agency. Prescribed

guarantees would be taken from the sponsors

of the project for the rebate.

d. Units, for which land is allotted on a rebated cost,

shall ensure that the facility to be created shall be

adequate to provide space for 500 IT professionals

on every acre of land.

e. Only the IT units with IT employee strength of a

100 will be eligible to be considered for allotment

of land.

f. CCITI is empowered to consider the eligibility of

the applicant based on the track record, business

proposal in terms of employment to be created,

office space to be built, investment to be made

and viability of the project proposal.

g. The Conditions of allotment, extent of land to be

allotted, employment to be created, office space

to be built, investments to be made and timelines

shall be incorporated in the MOU / Agreement

to be signed with the applicant-company.

h. Sub-leasing: Sub-leasing of the space created

for IT employment, under a scheme of incentives

would be permitted in the IT Layouts / IT Towers

to synergise collaborations and enhance IT

employment, subject to the condition that such

sub-leasing shall be only in favour of only any

other IT company.

A2 Fiscal Incentives

3.7 Registration & Stamp Duty: IT industry shall be

eligible for 100% reimbursement of the Stamp Duty,

Transfer Duty and Registration Fee paid on sale /

lease deeds on the first transaction and 50%

thereof on the second transaction.

3.8 Power Subsidy:

a. IT Units classified as MSME shall be eligible for

25% subsidy on power bills for a period of 3 years

from the date of commencement of commercial

operations or ` 30 lakh, whichever is earlier.

b. IT Units established by SC / ST & Women

Entrepreneurs shall be eligible for 50% subsidy

on power bills for a period of 5 years from the

date of commencement of commercial operations

or ` 50 lakhs, whichever is earlier.

c. Exemption of Electricity Duty and applicability

of Industrial Tariff: New IT / ITES units, after

coming into commercial operations will be entitled

for 100% exemption on Electricity duty for a period

of 5 years.

3.9 Patent Filing Cost: The cost of filing patents will be

reimbursed to the companies having their

headquarters in Andhra Pradesh, subject to a limit

of ` 5 lakh (0.5 mil) per domestic patent awarded

and ` 10 lakh (1 Mil) per international patent

awarded.

3.10 Quality Certification: IT Units shall be eligible for

reimbursement of 20% of expenditure incurred for

obtaining quality certifications for CMM Level 2

upwards, subject to a limit of ` 5 lakh (0.5 mil).

Similar reimbursement will be made to BS 7799

for security and also for ITES Companies for

achieving COPC and eSCM certification.

The IT / ITES units / Companies can claim this

incentive only once. In addition, this incentive

may be extended to other certifications based

on the recommendations of the CCITI.

3.11 Technology & Market Support: Government will

support IT Exporters Associations, ITsAP,

NASSCOM, ELIAP, STPI, IEG, or any such

organisation (as decided by CCITI) for conducting

surveys and / or research on trends in technology,

market intelligence or on other work useful to the

IT Industry.

3.12 Business Networking and Promotional Events:

Government shall promote and encourage

participation in various national and international

events by the industry and by leading a

Government-industry business delegation

to identified Exhibitions and Conferences.

Government would also undertake various

promotional events and road shows at various

locations from time to time.

B. Additional Incentives available to Mega IT Projects:

3.13 Mega Projects: Mega Projects are projects or

investment intents that can create employment

of 5,000 or more in a span of 5 years.

The following additional incentives would be

provided to the Mega Projects.

a. In casse where the premises is taken on lease /

rent, a rental subsidy @ ` 10 per sft. per month

shall be provided for a period of 3 years in a

prescribed scale of space per employee.

b. An investment subsidy of 10% of the value of the

Capital Expenditure, other than land, shall be

provided to Mega Projects that enter into an

MoU with the State within 2 years of notification

of the Policy.

C. Additional incentives available to MSME IT Units:

3.14 MSME IT units are those units that have an annual

turnover of ` 25 Cr. (250 mil). The following

additional incentives are available to such units:

a. A 50% subsidy on lease rentals up to a maximum

of ` 5 lakh (0.5 mil) per annum for a period of 3

years for any plug and play built up office space

taken by start-ups / MSMEs / first-generation

technocrat entrepreneurs, SC, ST & women

entrepreneurs STPI, either in IT / Multi-purpose

SEZs / IT Parks or in any notified private area /

location.

b. Market Development: 50% (100% for SC / ST

& Women Entrepreneurs) reimbursement of

the exhibition stall rental cost for participating

in the notified national / international exhibitions

limited to 9 sq.m. of space.

c. Recruitment / Training Assistance: Assistance

@ ` 20000 per IT professional employed within

a period of two years of establishing the unit.

d. All turnkey projects with an outlay up to ` 5 Cr.

(INR 50 Mil) to be undertaken by Government

Departments would be reserved for MSMEs

registered and operating in the State

e. Performance-linked Grant: MSMEs that record

a year-on-year growth rate of 15%, as per audited

accounts, shall be eligible to get a grant of 5%

on Turnover.

f. The Government has published on its portal

(www.ap.gov.in) a Blueprint for development of IT,

Electronics and e-Governance sectors in the State.

Suo moto proposals, based on AP Blueprint for

applications relevant to governmental needs would

be accepted from AP-based MSME IT units and the

proposals adjudged to be the best among those

found to be relevant for achieving the objectives

set out in the blueprint will be accepted and

projects to the tune of ` 50 Cr. (INR 500 Mil) p.a.

would be awarded to the IT units so selected.

g. Subsidy on Bandwidth for Connectivity: A 20%

subsidy on Bandwidth for connectivity paid to

Internet Service Provider (ISP) shall be available

for a period of two years from the date of starting

commercial production / operation.

D. Additional incentives available to IT Units established by SC / ST Entrepreneurs

3.15 The following additional incentives shall be available to IT Units established by SC / ST entrepreneurs.

Reservation of Built-up space Reservation of 15% built up space

Investment Subsidy 25% on the Fixed Capital & an additional 5% to SC / ST women

entrepreneurs, with a maximum limit per unit of ` 25 Lakh

Interest Subsidy 8.5% Interest Subsidy on Prime Lending Rate (PLR) on the term loan and

Working Capital subject to a maximum of ` 50 Lakh per year for a period

of 5 years for the units which commence commercial operations

ITEM INCENTIVE AVAILABLE

3.6 Land Allotment: Allotment of Government land

or land held by APIIC for industrial development,

to the IT units shall be governed by the following

principles.

a. The land allocation for IT Industry will be as per

GO Ms. No:571, Revenue (Assgn.I) Department,

dated:14/09/2012.

b. The land allotment would be based on the business

proposal and the investment capacity of the

company / investor.

c. Rebate on Cost of Land Allotted: A rebate on the

cost of the land will be provided @ ` 60,000 per

employee to the Mega IT Projects (defined below)

and ` 40,000 per employee for other IT projects,

subject to a maximum of 80% of the land cost as

determined by the allotment agency. Prescribed

guarantees would be taken from the sponsors

of the project for the rebate.

d. Units, for which land is allotted on a rebated cost,

shall ensure that the facility to be created shall be

adequate to provide space for 500 IT professionals

on every acre of land.

e. Only the IT units with IT employee strength of a

100 will be eligible to be considered for allotment

of land.

f. CCITI is empowered to consider the eligibility of

the applicant based on the track record, business

proposal in terms of employment to be created,

office space to be built, investment to be made

and viability of the project proposal.

g. The Conditions of allotment, extent of land to be

allotted, employment to be created, office space

to be built, investments to be made and timelines

shall be incorporated in the MOU / Agreement

to be signed with the applicant-company.

h. Sub-leasing: Sub-leasing of the space created

for IT employment, under a scheme of incentives

would be permitted in the IT Layouts / IT Towers

to synergise collaborations and enhance IT

employment, subject to the condition that such

sub-leasing shall be only in favour of only any

other IT company.

3.7 Registration & Stamp Duty: IT industry shall be

eligible for 100% reimbursement of the Stamp Duty,

Transfer Duty and Registration Fee paid on sale /

lease deeds on the first transaction and 50%

thereof on the second transaction.

3.8 Power Subsidy:

a. IT Units classified as MSME shall be eligible for

25% subsidy on power bills for a period of 3 years

from the date of commencement of commercial

operations or ` 30 lakh, whichever is earlier.

b. IT Units established by SC / ST & Women

Entrepreneurs shall be eligible for 50% subsidy

on power bills for a period of 5 years from the

date of commencement of commercial operations

or ` 50 lakhs, whichever is earlier.

c. Exemption of Electricity Duty and applicability

of Industrial Tariff: New IT / ITES units, after

coming into commercial operations will be entitled

for 100% exemption on Electricity duty for a period

of 5 years.

3.9 Patent Filing Cost: The cost of filing patents will be

reimbursed to the companies having their

headquarters in Andhra Pradesh, subject to a limit

of ` 5 lakh (0.5 mil) per domestic patent awarded

and ` 10 lakh (1 Mil) per international patent

awarded.

3.10 Quality Certification: IT Units shall be eligible for

reimbursement of 20% of expenditure incurred for

obtaining quality certifications for CMM Level 2

upwards, subject to a limit of ` 5 lakh (0.5 mil).

Similar reimbursement will be made to BS 7799

for security and also for ITES Companies for

achieving COPC and eSCM certification.

The IT / ITES units / Companies can claim this

incentive only once. In addition, this incentive

may be extended to other certifications based

on the recommendations of the CCITI.

3.11 Technology & Market Support: Government will

support IT Exporters Associations, ITsAP,

NASSCOM, ELIAP, STPI, IEG, or any such

organisation (as decided by CCITI) for conducting

surveys and / or research on trends in technology,

market intelligence or on other work useful to the

IT Industry.

Government shall promote and encourage

events by the industry and by leading a

Government-industry business delegation

to identified Exhibitions and Conferences.

Government would also undertake various

promotional events and road shows at various

locations from time to time.

B. Additional Incentives available to Mega IT Projects:

3.13 Mega Projects: Mega Projects are projects or

investment intents that can create employment

of 5,000 or more in a span of 5 years.

The following additional incentives would be

provided to the Mega Projects.

a. In casse where the premises is taken on lease /

rent, a rental subsidy @ ` 10 per sft. per month

shall be provided for a period of 3 years in a

prescribed scale of space per employee.

b. An investment subsidy of 10% of the value of the

Capital Expenditure, other than land, shall be

provided to Mega Projects that enter into an

MoU with the State within 2 years of notification

of the Policy.

C. Additional incentives available to MSME IT Units:

3.14 MSME IT units are those units that have an annual

turnover of ` 25 Cr. (250 mil). The following

additional incentives are available to such units:

a. A 50% subsidy on lease rentals up to a maximum

of ` 5 lakh (0.5 mil) per annum for a period of 3

years for any plug and play built up office space

taken by start-ups / MSMEs / first-generation

technocrat entrepreneurs, SC, ST & women

entrepreneurs STPI, either in IT / Multi-purpose

SEZs / IT Parks or in any notified private area /

location.

b. Market Development: 50% (100% for SC / ST

& Women Entrepreneurs) reimbursement of

the exhibition stall rental cost for participating

in the notified national / international exhibitions

limited to 9 sq.m. of space.

c. Recruitment / Training Assistance: Assistance

@ ` 20000 per IT professional employed within

a period of two years of establishing the unit.

d. All turnkey projects with an outlay up to ` 5 Cr.

(INR 50 Mil) to be undertaken by Government

Departments would be reserved for MSMEs

registered and operating in the State

e. Performance-linked Grant: MSMEs that record

a year-on-year growth rate of 15%, as per audited

accounts, shall be eligible to get a grant of 5%

on Turnover.

f. The Government has published on its portal

Suo moto proposals, based on AP Blueprint for

applications relevant to governmental needs would

be accepted from AP-based MSME IT units and the

proposals adjudged to be the best among those

found to be relevant for achieving the objectives

set out in the blueprint will be accepted and

projects to the tune of ` 50 Cr. (INR 500 Mil) p.a.

would be awarded to the IT units so selected.

g. Subsidy on Bandwidth for Connectivity: A 20%

subsidy on Bandwidth for connectivity paid to

Internet Service Provider (ISP) shall be available

for a period of two years from the date of starting

commercial production / operation.

D. Additional incentives available to IT Units established by SC / ST Entrepreneurs

3.15 The following additional incentives shall be available to IT Units established by SC / ST entrepreneurs.

Investment Subsidy 25% on the Fixed Capital & an additional 5% to SC / ST women

entrepreneurs, with a maximum limit per unit of ` 25 Lakh

Interest Subsidy 8.5% Interest Subsidy on Prime Lending Rate (PLR) on the term loan and

Working Capital subject to a maximum of ` 50 Lakh per year for a period

of 5 years for the units which commence commercial operations

E. Additional Incentives available to IT Units established by Women Entrepreneurs

3.16 The following additional incentives shall be available to IT Units established by women entrepreneurs.

Investment Subsidy 20% on the Fixed Capital with a maximum limit per unit of ` 20 Lakh

Interest Subsidy 5% (8.5% for SC / ST women entrepreneurs) Interest Subsidy on Prime

Lending Rate (PLR) on the term loan and Working Capital subject to a

maximum of ` 50 Lakh per year for a period of 5 years for the units which

commence commercial operations

F. Additional Incentives available to Rural IT Units

3.17 In addition to the incentives available for MSMEs,

IT Units established in Rural areas shall be eligible

for the following incentives:

a. All district-based turnkey projects with an outlay

of up to ` 50 Lakhs would be reserved for

Rural IT companies.

b. Subsidized loans towards the infrastructure /

operations cost through SFC / rural banks

would be arranged for such enterprises.

G. General Provision relating to incentives:

3.18 The incentives listed herein would be available

to the new companies and to the expansions of

existing companies, unless the same has been

claimed earlier.

4. Governance of IT Policy

4.1 Effective Single-Window System: A highly

empowered ‘Single Window Clearance Unit’ will be

created and operationalized for granting approvals

& clearances for setting up New IT Units and for

expansion of the existing IT units in the State.

It would be supported by a state-of-the-art

centralized help desk on a 24x7 basis duly

leveraging the e-Biz portal set up by GoI.

The objective of this window would be to

(a) reduce time to set up business and

(b) reduce cost of doing business.

4.2 Time-bound Approvals: The following procedural

reform would be undertaken with an aim to provide

approvals to the industry / investors within 4 weeks.

a. Integrated Application for all permissions

b. Escort Officer to be assigned the responsibility

for getting approvals

c. Escalation at various levels and regular monitoring

A provision shall be made in the relevant legislations

or rules that in case the required approvals are not

granted within 4 weeks of receipt of an application in

full-shape, the approval shall be deemed to have been

given.

4.3 Empowered Mission for Electronics & IT

Promotion: An empowered Mission would be

established to give a fillip to the development of

the sector and take faster and agile decisions.

The mission would be headed by a technocrat

and would have 3 experts in Electronics & IT,

2 academicians and an expert in Marketing &

Promotion.

4.4 APIIC to be Industrial Area Local Authority

(IALA): All IT Industrial Areas / IT Layouts / Zones /

Corridors, including Electronic Manufacturing

Clusters (EMCs) and ITIR delineated processing

areas of APIIC in the State shall be accorded the

status of Industrial Authority Local Area (IALA)

immediately so that the execution and maintenance

of IT Industrial areas shall be effectively planned,

executed and implemented by APIIC in the interest

of the promotion of Information Technology Sector.

All statutory clearances to IT Parks / IT Campuses

constructed by IT Infrastructure Companies /

builders / developers and IT / ITES Industry /

Companies / Units for own use on lands allotted

by APIIC in their Industrial Local Area Authority,

would be given by APIIC.

This Policy is valid for a period of 5 years from the date

of its notification and supersedes the ICT Policy 2010-

ITE&C Department shall issue appropriate

Implementation / Operational Guidelines with

simplified application proforma and procedure for

claiming of the incentives.

Andhra Pradesh Electronics Policy 2014-202002

E. Additional Incentives available to IT Units established by Women Entrepreneurs

3.16 The following additional incentives shall be available to IT Units established by women entrepreneurs.

Investment Subsidy 20% on the Fixed Capital with a maximum limit per unit of ` 20 Lakh

Interest Subsidy 5% (8.5% for SC / ST women entrepreneurs) Interest Subsidy on Prime

Lending Rate (PLR) on the term loan and Working Capital subject to a

maximum of ` 50 Lakh per year for a period of 5 years for the units which

commence commercial operations

F. Additional Incentives available to Rural IT Units

3.17 In addition to the incentives available for MSMEs,

IT Units established in Rural areas shall be eligible

for the following incentives:

a. All district-based turnkey projects with an outlay

of up to ` 50 Lakhs would be reserved for

Rural IT companies.

b. Subsidized loans towards the infrastructure /

operations cost through SFC / rural banks

would be arranged for such enterprises.

G. General Provision relating to incentives:

3.18 The incentives listed herein would be available

to the new companies and to the expansions of

existing companies, unless the same has been

claimed earlier.

4. Governance of IT Policy

empowered ‘Single Window Clearance Unit’ will be

created and operationalized for granting approvals

& clearances for setting up New IT Units and for

expansion of the existing IT units in the State.

It would be supported by a state-of-the-art

centralized help desk on a 24x7 basis duly

leveraging the e-Biz portal set up by GoI.

The objective of this window would be to

(a) reduce time to set up business and

4.2 Time-bound Approvals: The following procedural

reform would be undertaken with an aim to provide

approvals to the industry / investors within 4 weeks.

b. Escort Officer to be assigned the responsibility

for getting approvals

A provision shall be made in the relevant legislations

or rules that in case the required approvals are not

granted within 4 weeks of receipt of an application in

full-shape, the approval shall be deemed to have been

given.

4.3 Empowered Mission for Electronics & IT

Promotion: An empowered Mission would be

established to give a fillip to the development of

the sector and take faster and agile decisions.

The mission would be headed by a technocrat

and would have 3 experts in Electronics & IT,

2 academicians and an expert in Marketing &

Promotion.

4.4 APIIC to be Industrial Area Local Authority

(IALA): All IT Industrial Areas / IT Layouts / Zones /

Corridors, including Electronic Manufacturing

Clusters (EMCs) and ITIR delineated processing

areas of APIIC in the State shall be accorded the

status of Industrial Authority Local Area (IALA)

immediately so that the execution and maintenance

of IT Industrial areas shall be effectively planned,

executed and implemented by APIIC in the interest

of the promotion of Information Technology Sector.

All statutory clearances to IT Parks / IT Campuses

constructed by IT Infrastructure Companies /

builders / developers and IT / ITES Industry /

Companies / Units for own use on lands allotted

by APIIC in their Industrial Local Area Authority,

would be given by APIIC.

This Policy is valid for a period of 5 years from the date

of its notification and supersedes the ICT Policy 2010-

ITE&C Department shall issue appropriate

Implementation / Operational Guidelines with

simplified application proforma and procedure for

claiming of the incentives.

Andhra Pradesh Electronics Policy 2014-202002

Gateway Backside

No Printing

Andhra P

radesh

Electronics P

2014-2020

The Vision envisaged for the Andhra Pradesh

Electronics Policy 2014-2020 is: “To develop

Electronics Industry as an important Growth Engine

for Andhra Pradesh through effective use of the

talent pool, skill enhancement, promotion of

innovation & future technologies and creation of

excellent infrastructure.”

The Policy aims to attract investments to the tune of

` 40,000 Cr. (USD 5 Billion) in ESDM sector and create

an employment of 4 lakhs (0.4 Million) by 2020.

Government of AP intends to achieve its vision,

objectives and goals set forth above, through a

combination of the following strategies.

Globally, the Electronics Industry is the largest and

fastest growing manufacturing industry in the world,

with a size of USD 1.75 Trillion. It is expected to reach

USD 2.4 Trillion by 2020. The demand in the Indian

market was USD 70 Billion in 2013-14 and is expected

to reach USD 400 Billion by 2020. Domestic demand

is expected to be driven by the growth in income levels

leading to higher off-take of electronics products,

automation demands of corporate sector and

Government’s focus on e-Governance. However, with

a low domestic manufacturing base and a low value

addition, the demand-supply gap is likely to reach

USD 300 Billion by 2020. To meet this alarming situation,

and to enhance domestic manufacturing and value-

addition in Electronics Systems Design and

Manufacturing (ESDM), the Department of Electronics

and Information Technology (DeitY), Ministry of

Communications and Information Technology (MoC&IT),

Government of India, notified the National Policy on

Electronics in 2012. The NPE 2012 seeks to attract

investments to the tune of USD 100 Billion and to create

employment of 28 Million by 2020.

Context for the AP Electronics Policy

Government of Andhra Pradesh has recently developed

a blueprint “Re-Imagining Andhra Pradesh -

Role of e-Governance, Electronics and IT” for the

development of the Electronics & ICT Industry in the

State. It has laid out a vision to:

“Develop AP as an Innovation Society of global repute,

with a focus on enhancing the Quality of Life of its

citizens, through high-quality Education and

Healthcare, increased productivity in Agriculture and

allied activities, creation of Employment by promoting

Electronics and IT, and above all, by providing Good

Governance.”

frameworks to realize the Vision. The Electronics Policy

laid down in this document is one among them.

Andhra Pradesh with its huge talent pool, skilled

manpower and entrepreneurship is highly suited to

take advantage of the opportunities offered by the

Electronics sector.

PREPARING FOR THE FUTURE

2. Building Infrastructure

2.1 Mega Electronics Hub: Government of Andhra Pradesh envisages developing an Information Technology and Investment Region (ITIR) in Visakhapatnam. In the ITIR, the Government would reserve two clusters / areas to be solely developed as Electronics Hubs. Visakhapatnam is proposed to be developed as a Mega Electronics Hub for the State.

2.2 Electronic Hardware Park(s): GoAP will facilitate the setting up of the Electronic Hardware Park in Kakinada as announced by GoI. The Park would feature state-of-the-art infrastructure with all basic amenities such as internal roads, water, power and other common facilities for the Electronics Units.

2.3 Common Facilities Centre: Common Facilities Centres would be created in all identified Electronics Hubs.

2.4 Visakhapatnam-Chennai Corridor: Fast movement of inputs, components and finished products is essential for cost-effectiveness in the ESDM sector, which otherwise operates on thin margins. Steps would be taken to enhance the logistics along the Visakhapatnam-Chennai Corridor.

2.5 PPP for Creation of Electronics Hardware Infrastructure: Facilities, in the form of electronics hubs, hardware parks and electronics zones, shall be developed adopting a transparent PPP policy. The following principles will form part of the policy:

a. For each project, APIIC shall select a partner, who can be a developer or a consortium of developers and the industry players, through a bidding process involving the QCBS method.

b. The responsibility of marketing the facilities created shall vest with the selected partner. The Government shall provide promotional support as needed.

c. Appropriate relaxations will be provided from the zoning regulations and land usage conversions, subject to environmental safeguards.

d. Relaxation to AP Building Rules would be considered, subject to the payment of City Level Infrastructure Impact Fee and clearances from Fire Services, Airport Authority and conformance to the National Building Code and statutory regulations.

2.6 Renewable Energy: The State Government will encourage units using renewable energy. Units using renewable source of energy with a minimum of 40% of their power requirements coming from renewable sources for their operations and manufacturing will be eligible for additional incentives such as Electricity Duty exemption for5 years. Sales tax exemption for 2 additional years shall be available against the Carbon Credits earned on a year-on-year basis.

1. Adopting and promoting of NPE 2012 of GoI

Given the comprehensive and holistic nature of the National Policy on Electronics 2012, the Government of AP intends to fully leverage the same and build upon its strengths, as stated below.

1.1 Electronics Manufacturing Clusters (EMCs): The EMC Scheme intends to create infrastructure highly suited to electronics units by providing a subsidy of 50%. The Government of Andhra Pradesh proposes to promote the development of 20 EMCs across the State, by facilitating the preparation of project proposals by the entrepreneurs and providing single-window clearances.

1.2 Target investment of ` 30,000 Cr. under M-SIPS: Government would make all efforts to attract investments to the tune of ` 30,000 Cr. (USD 5 Billion) and facilitate the units to get the 25% Capital Expenditure subsidy under the M-SIPS scheme of GOI.

1.3 Preferential Market Access: The policy of GoI on preferential market access for domestically manufactured electronics products shall be implemented in all departments procuring electronics in large quantities. Additional preference shall be given to AP-based domestic manufacturers.

1.4 Create a Joint Government-Industry committee to market India and attract investments in the Country.

1.5 Create a fund under the management of the Committee comprising representatives of industry bodies and government, with an equal stake to promote design, manufacturing, assembling and innovation and packaging business.

1. Adopting and

promoting of

NPE 2012 of GoI

2. Building

Infrastructure

3. Top-up

incentives of GoI

4. Promotion of

“Electronics AP”

5. Adoption of

“Mission

Approach”

6. Innovation &

Capacity

Building

Booklet on ITE&C Department Policies, 2014-2020 | 20 21 | Booklet on ITE&C Department Policies, 2014-2020